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Sectra — Interim / Quarterly Report 2008
May 20, 2008
2967_10-k_2008-05-20_b2056e58-2b56-48bb-b9cf-8fd135461fa9.pdf
Interim / Quarterly Report
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Year-end report for Sectra AB 2007/2008 fiscal year:
Order bookings exceed 1 billion for first time
In its 2007/2008 year-end report, IT and medical-technology company Sectra reported its best order bookings and highest sales ever. The Group's order bookings rose 48.5% to SEK 1,016.6 million (684.7) and net sales increased 10.5% to SEK 742.9 million (672.5). Profit after financial items rose 13.7% to SEK 79.8 million (70.2), corresponding to a profit margin of 10.7% (10.4).
Sectra's net sales for the fourth quarter rose 9.6% to SEK 224.5 million (204.8). Profit after net financial items increased 80.8% to SEK 42.3 million (23.4), corresponding to a profit margin of 18.9% (11.4). Order bookings amounted to SEK 158.3 million (166.9).
"The year was characterized by exceptionally high order bookings," says Jan-Olof Brüer, CEO and President of Sectra AB. "This is, among others, a result of securing large service and support contracts for medical imaging systems that were previously maintained by partners. These contracts give us increased credibility on the market.
"We also achieved our profit goal this year, a profit margin exceeding 10%. The Secure Communication Systems business area continues to post successes and contribute to the Group's improved earnings."
The international expansion continued and markets outside Sweden now account for 66.8% of the Group's sales. Sectra has grown the most on the American market. Sectra is continuing its focus on expanding the distribution network, service organization and to strengthen the product offering on strategic markets.
"During the fourth quarter we took a step into the world's next largest market for medical technology, Japan, through an agreement with a distributor and opening a local office," continues Jan-Olof Brüer. "We have also strengthened our product offering on the American market with an integrated solution for information and image processing in radiology."
For further information, contact:
Jan-Olof Brüer, President and CEO Sectra AB, tel. +46 13 23 52 09.
Sectra AB (publ)
Year-end report for Sectra AB (publ) for May 2007–April 2008
The figures for the preceding year are shown in parentheses.
The year in brief
- Order bookings rose 48.5% to SEK 1,016.6 million (684.7).
- Net sales increased 10.5% to SEK 742.9 million (672.5).
- Profit after net financial items rose 13.7% to SEK 79.8 million (70.2), corresponding to a profit margin of 10.7% (10.4).
- Profit after tax rose 7.0% to SEK 50.5 million (47.2).
- Earnings per share rose to SEK 1.37 (1.28).
Fourth quarter in brief
- Order bookings amounted to SEK 158.2 million (166.9).
- Net sales rose 9.6% to SEK 224.5 million (204.8).
- Profit after net financial items increased 80.8% to SEK 42.3 million (23.4), corresponding to a profit margin of 18.9% (11.4).
- Profit after tax rose 65.7% to SEK 23.2 million (14.0).
- Earnings per share rose to SEK 0.63 (0.38).
Significant events during the quarter
- Sectra initiated cooperation with a Japanese supplier of medical equipment that will distribute Sectra's medical systems in Japan.
- Instituto Portugûes de Oncologia do Porto Francisco Gentil, a leading oncology institute in Portugal selected Sectra's system for processing of digital radiology images (PACS) to digitize its image diagnostic operations that comprise eight departments.
- Södertälje Hospital became the first in Sweden to use Sectra's new diagnostic workstation for radiologists, IDS7/dx. The workstation is optimized for distributed review and processing large volumes of data and is the latest addition to Sectra's new-generation PACS.
Significant events after the year-end closing date
• The Belgian private clinic for women's health, Brussels Menopause Center, became the first to offer women in Brussels the possibility to choose mammography at the market's lowest dose when the clinic invested in Sectra's digital mammography system.
Sectra AB (publ)
Teknikringen 20 583 30 Linköping Tel: 013 23 52 00 Fax: 013 21 21 85 [email protected] www.sectra.se Moms reg.nr SE556064830401
Order bookings, net sales and earnings
The 2007/2008 fiscal year
The Group's order bookings for the period rose by 48.5% to SEK 1,016.6 million (684.7). This consists largely of added sales to the existing customer base. Sectra has successfully concluded service and upgrade agreements with hospitals and clinics that previously have been using Sectra PACS, which contributed to the business area's increased order bookings compared with the preceding fiscal year. Among these customers are two of the largest health care providers in the US, New York City Health and Hospital Corporation and ProMedica Health Systems, as well as the majority of London's public hospitals through an agreement with British Telecommunications plc.
Net sales for the fiscal year were up 10.5% to SEK 742.9 million (672.5). The increase compared with a year earlier is a result of increased deliveries of medical systems and eavesdrop-secure communications systems on international markets. Revenues from markets outside Sweden rose 15.0% to SEK 469.1 (431.3) and account for 66.8% of consolidated net sales. The strongest expansion occurred on the North American market.
Profit after net financial items rose 13.7% to SEK 79.8 million (70.2), corresponding to a profit margin of 10.7% (10.4). The increase compared with the preceding fiscal year is attributable mainly to strengthened earnings for the Secure Communication Systems business area. Profit after tax rose 7.0 per cent to SEK 50.5 million (47.2). Earnings per share amounted to SEK 1.37 (1.28).
Sales in international markets are primarily in USD and EUR, implying that the company's sales and earnings are impacted by the fluctuations of these currencies. During the fiscal year, the Swedish krona was strengthened against both the USD and EUR. These changes affected the consolidated operating profit negatively by approximately SEK 12.0 million, compared with the preceding year.
Fourth quarter
The Group's order bookings amounted to SEK 158.3 million (166.9). Demand for Sectra's products is strong, but variations in order volume within individual quarters are significant.
Net sales for the quarter rose 9.6% to SEK 224.5 million (204.8). Higher revenues from direct sales on the European market contributed to the increase.
Profit after net financial items was up 80.8% to SEK 42.3 million (23.4), corresponding to a profit margin of 18.9% (11.4). The increase compared with the year-earlier quarter is due primarily to capitalizing expenditures for development investments in Sectra's new product generation in Medical Systems. Currency rate changes affected the Group's operating profit for the quarter negatively by about SEK 4.5 million compared with a year earlier. Profit after tax increased 65.7% to SEK 23.2 million (14.0). Earnings per share rose to SEK 0.63 (0.38).
Seasonal variations
Traditionally, Sectra has seasonal variations in which the fiscal year begins with low sales. As a rule, most of the invoicing and earnings occur in the third an fourth quarters. This pattern also applied in the 2007/2008 fiscal year.
Net sales by business segment, Rolling 12 months
Net sales by geographical market, Rolling 12 months
Sectra AB (publ)
Teknikringen 20
583 30 Linköping
Tel: 013 23 52 00
Fax: 013 21 21 85
www.sectra.se Moms reg.nr SE556064830401
| Net sales by business segment | ||||
|---|---|---|---|---|
| (SEK million) | 3 months | 3 months | Full year | Full year |
| Feb. 2008 | Feb. 2007 | May–Apr. | May–Apr. | |
| –Apr. 2008 | –Apr. 2007 | 2007/2008 | 2006/2007 | |
| Medical systems | 202.8 | 193.5 | 659.6 | 610.9 |
| Secure communication | ||||
| systems | 26.9 | 17.3 | 95.3 | 67.9 |
| Other 1) | 7.1 | 5.4 | 22.9 | 21.0 |
| Group eliminations | -12.3 | -11.4 | -34.9 | -27.3 |
| Total | 224.5 | 204.8 | 742.9 | 672.5 |
| Operating profit/loss by business segment | ||||
|---|---|---|---|---|
| (SEK million) | 3 months | 3 months | Full year | Full year |
| Feb. 2008 | Feb. 2007 | May–Apr. | May–Apr. | |
| –Apr. 2008 | –Apr. 2007 | 2007/2008 | 2006/2007 | |
| Medical systems | 38.2 | 24.4 | 65.0 | 63.8 |
| Secure communication | ||||
| systems | 5.1 | 2.1 | 13.8 | 6.2 |
| Other 1) | 3.6 | -2.4 | 3.0 | -5.9 |
| Group eliminations | -0.1 | -1.8 | -2.1 | -2.9 |
| Total | 46.8 | 22.3 | 79.7 | 61.2 |
1) Other refers primarily to the Parent Company's debiting of Group-wide services and asset management.
| Net sales by geographical market | ||
|---|---|---|
| (SEK million) | 3 months | 3 months | Full year | Full year |
|---|---|---|---|---|
| Feb. 2008 | Feb. 2007 | May–Apr. | May–Apr. | |
| –Apr. 2008 | –Apr. 2007 | 2007/2008 | 2006/2007 | |
| Sweden | 69.5 | 49.8 | 246.8 | 241.3 |
| Rest of Europe | 93.0 | 83.8 | 263.6 | 235.3 |
| North America | 46.4 | 66.1 | 204.2 | 177.8 |
| Rest of world | 15.6 | 5.1 | 28.3 | 18.1 |
| Total | 224.5 | 204.8 | 742.9 | 672.5 |
Medical systems
Market
The market for Sectra's medical systems is growing as an increasing number of hospitals choose to improve the efficiency of their radiology operations by introducing digital systems for image and information processing. To meet demand on the market, Sectra continues with investments to build out the distribution network and service organization. In addition, Sectra also strengthened its product offering on the American market during the fiscal year through also providing a system for radiological information processing.
More than 45 million radiology examinations are carried out in the company's system annually, making Sectra one of the world's leading suppliers of systems for processing of digital radiology images. During 2007/2008, Sectra installed medical systems at more than 50 new customers worldwide. As the number of installations of Sectra medical systems increases, so does revenue from service, support and upgrade contracts. At the same time, the share of contracts is increasing in which customers undertake during a longer period to recurringly pay
Sectra AB (publ)
for the use of the system instead of making an initial license payment. The largest portion of radiology clinics using Sectra's medical systems are in North America, the world's largest and one of the fastest growing market for medical IT.
The medical technology industry in the US has been affected adversely in the past year by measures to reduce the country's budget deficit taken by the US authorities, the Deficit Reduction Act (DRA). Among other effects, DRA results in a reduction of the reimbursements to hospitals and clinics from the government and insurance companies for various types of examinations and medical treatments, particularly in the field of medical imaging in which PACS is included. Despite DRA, Sectra increased sales on the American market for the fiscal year. This is attributable mainly to success in securing service and support contracts and that Sectra has become more visible for American customers through its high ranking in the KLAS customer evaluation.
Changed business mix
During the past fiscal year, Sectra's operations have undergone a couple of major changes that impacted the profit margin. One of these is the phasing out of the cooperation with Philips Medical Systems. The other is the launch of Sectra MicroDose Mammography, which results in a larger share of manufacturing operations. A greater share of direct sales and higher sales of mammography equipment increasing the share of deliveries including both software and hardware, and yields lower margins than sales of software licenses alone, that sales through partners usually consist of.
Order bookings
As a result of increased marketing efforts, Sectra has posted major sales successes internationally during the year. The number of service and upgrade contracts as well as license sales to new customers increased.
Application for approval to sell Sectra MicroDose Mammography in US
Through a modular application process, the first sections of Sectra's application to sell Sectra MicroDose Mammography in the US were submitted to the American authority, the FDA (Food and Drug Administration) during the period. The final section, which contains the clinical study required for approval, is expected to be submitted during the first half of 2008.
Sales and earnings
Medical Systems' net sales for the fiscal year rose 8.0% to SEK 659.6 million (610.9). The increase is a result of the investment in expanding in strategically important markets, which resulted in an increase in direct sales and the volume of service contracts compared with the year-earlier period. Sectra's mammography operations also account for part of the increased sales.
Operating profit for the fiscal year rose 1.9% to SEK 65.0 million (63.8), corresponding to an operating margin of 10.0% (10.4).
The business area's sales in the fourth quarter rose 4.8% to SEK 202.8 million (193.5). The increase compared with the year-earlier quarter is due primarily to increased sales on the Swedish market.
Operating profit for the quarter rose 56.6% to SEK 38.2 million (24.4), corresponding to an operating margin of 18.9% (12.6). The increase compared with the year-earlier quarter is due mainly to capitalization of expenditures for development efforts for the new product generation of the business area's main product, PACS.
Sectra AB (publ)
Teknikringen 20 583 30 Linköping Tel: 013 23 52 00 Fax: 013 21 21 85 [email protected] www.sectra.se Moms reg.nr SE556064830401
Secure Communication Systems
Market
Among European authorities and defense agencies, pan-national cooperation is increasing, which means that demands for secure communication systems shift from being national in focus to being a common issue for the entire EU. This creates a new market for EU-approved crypto products.
To meet customer demands, Sectra has invested in recent years in development and marketing for third-generation Tiger products, Tiger XS and Sectra the first with an EU-approved crypto product for mobile communications at the Secret UE security level.
Order bookings
Among the results of focusing on the European government market, Sectra has, during the year, signed a four-year full-service contract with the Netherlands Interior Ministry covering Tiger products for eavesdrop-secure mobile and fixed voice communications as well as the operation and security administration of these products. New users of Sectra's Tiger system also include the Hungarian Ministry of Foreign Affairs, which in preparing of its upcoming EU presidency ordered Tiger products for secure voice communications.
Sales and earnings
Net sales for Secure Communication Systems for the fiscal year rose 40.4% to SEK 95.3 million (67.9). Operating profit increased by 122.6% to SEK 13.8 million (6.2), corresponding to an operating margin of 14.5% (9.1).
For the fourth quarter, net sales for the business area rose 54.6% to SEK 26.9 million (17.4). Operating profit for the period rose 142.9% to SEK 5.1 million (2.1), for an operating margin of 19.0% (12.1).
Financial position
The equity/asset ratio on April 30, 2008, was 56.9% (60.8) and liquidity was a multiple of 2.2 (2.5).
The company's interest-bearing liabilities amounted at the end of the period to SEK 63.6 million (48.0), of which SEK 56.6 million (46.1) pertains to convertible debentures.
Investments
Group investments during the fiscal year totaled SEK 83.0 million (58.6), of which SEK 47.1 million (11.6) pertained to the fourth quarter. Capitalized development expenditures during the fourth quarter amounted to SEK 30.2 million (10.6) and amounted on April 30, 2008, to SEK 186.2 million (138.1).
Employees
The number of employees with full-time employment at Sectra increased during the fourth quarter by 12 persons. On April 30, 2008, the number of employees totaled 506 (455).
The share
During the fourth quarter, in accordance with a decision by the 2007 Annual General Meeting, Sectra employees in the US were given the opportunity to subscribe for additional stock options. If these stock options are fully utilized, employees will acquire 100,000 Series B shares in the company, corresponding to 0.3% of the share capital and 0.2% of the voting rights. The stock options may be exercised from May 24 to and including May 28, 2010, and the redemption price is SEK 82.20.
Sectra's share capital at April 30, 2008, amounted to SEK 36,842,088. Full conversion and exercise of the incentive programs implemented will increase the number of shares by a maximum of 717,300, corresponding 1.9% of the share capital and 1.2% of the voting rights. After full dilution, the number of shares will amount to 37,559,388.
Sectra AB (publ)
Teknikringen 20 583 30 Linköping
Tel: 013 23 52 00
Fax: 013 21 21 85
www.sectra.se
Risks and uncertainty factors
Sectra is, through its operations, exposed to business risks such as dependence on major customers and partners, the effect of the exchange rate of the USD on pricing in the markets in which the Group is active, and property and liability risks. In addition, Sectra is exposed to various types of financial risks such as currency, interest, loan and liquidity risks.
A detailed description of the risks and uncertainty factors, as well as Sectra's strategies and tactics for minimizing risk exposure and limiting adverse effects, is provided in the Group's Annual Report for 2006/2007 fiscal year, page 46, Note 27. No significant events have occurred that would alter the conditions reported therein.
2008 Annual General Meeting
The Annual General Meeting of shareholders in Sectra AB will take place on Wednesday, June 25, at CET 4:00 p.m. in the Collegium Building, Teknikringen 7, in Linköping. A notice will be published in the Swedish daily newspaper Svenska Dagbladet and in the Swedish Official Gazette on May 28.
Proposed dividend
For 2007/2008, the Board of Directors proposes a dividend of SEK 0.50 (0.50) per share. June 30, 2008, is proposed as the record date for the dividend. If the Annual General Meeting adopts the proposal, it is expected that VPC AB will remit the dividend payments on July 3, 2008.
Nomination Committee
The Nomination Committee, which has been appointed in accordance with the decision of the 2007 Annual General Meeting, consists of the following members:
- Carl-Eric Ridderstråhle, Chairman of the Board (convening authority)
- Jan-Olof Brüer, CEO and President of Sectra AB, representing the largest shareholders (Chairman)
- Annika Andersson, representing the Fourth Swedish National Pension Fund
The Nomination Committee, led by Jan-Olof Brüer, has prepared proposals for the elections of the Chairman of the Annual General Meeting, Board Chairman and the other members of the Board of Directors, the fee to be paid to the Board and the fee to be paid to the auditor. The Nomination Committee will present proposals in adequate time prior to the Annual General Meeting, but not later than two weeks prior to the Meeting.
Annual Report
The Annual Report will be available at the company on June 11, 2008, and will be distributed by mail to new shareholders and to those shareholders who have indicated a desire to receive financial reports. It will also be available on the Sectra website, www.sectra.se. The print version may be ordered, from:
Sectra AB Teknikringen 20 SE-583 30 Linköping, Sweden Tel. +46 13 23 52 00 E-mail: [email protected]
Outlook
Sectra has a strong technology platform. The products and system solutions that Sectra develops are aimed at markets with high growth potential. The company's strong position in the home market provides a solid platform for ongoing international expansion.
The Board's assessment is that, in the long term, Sectra will continue to expand with favorable profitability.
Sectra AB (publ)
Teknikringen 20 583 30 Linköping Tel: 013 23 52 00
Fax: 013 21 21 85
www.sectra.se
Parent Company Sectra AB
The Parent Company includes head office functions such as group finances and data administration as well as exchange, share and investor-related operations.
Net sales in the Parent Company Sectra AB for the fiscal year amounted to SEK 24.2 M (20.9). Profit after net financial items amounted to SEK 189,1 M (156,8).
The Parent Company's income statement and balance sheet are reported on page 11.
Sectra AB (publ)
Teknikringen 20 583 30 Linköping Tel: 013 23 52 00 Fax: 013 21 21 85 [email protected] www.sectra.se Moms reg.nr SE556064830401
Condensed income statement for the Group
| 3 months | 3 months | Full-year | Full-year | |
|---|---|---|---|---|
| SEK thousands | Feb 2008 | Feb 2007 | May–Apr | May–Apr |
| – Apr 2008 | – Apr 2007 | 2007/2008 | 2006/2007 | |
| Net sales | 224 528 | 204 767 | 742 923 | 672 511 |
| Capitalized work for own use | 30 196 | 10 599 | 57 847 | 42 581 |
| Operating expenses | -202 327 | -186 446 | -699 733 | -631 624 |
| Depreciation | -5 572 | -6 597 | -21 338 | -22 287 |
| Operating profit | 46 825 | 22 323 | 79 699 | 61 181 |
| Net financial items | -4 493 | 1 096 | 80 | 9 021 |
| Profit after financial items | 42 332 | 23 419 | 79 779 | 70 202 |
| Tax on earnings for the period | -19 179 | -9 415 | -29 315 | -22 986 |
| Net profit | 23 153 | 14 004 | 50 464 | 47 216 |
| Profit attributable to equity holders | ||||
| of the: | ||||
| Parent Company | 23 153 | 14 004 | 50 464 | 47 216 |
| Minority interest | 0 | 0 | 0 | 0 |
| Earnings per share | ||||
| Before dilution, SEK | 0.63 | 0.38 | 1.37 | 1.28 |
| After dilution, SEK | 0.61 | 0.37 | 1.34 | 1.26 |
| No. of shares at end of period | ||||
| Before dilution | 36 842 088 | 36 783 188 | 36 842 088 | 36 783 188 |
| After dilution 1) | 37 559 388 | 37 529 988 | 37 559 388 | 37 529 988 |
| Average, before dilution 2) | 36 842 088 | 36 783 188 | 36 832 271 | 36 758 743 |
| Average, after dilution 1) 2) 3) | 37 662 855 | 37 476 655 | 37 594 096 | 37 400 488 |
1) Dilution is based on the convertible debenture programs issued in 2006/2007 (266,800) and 2007/2008 (270,500) and the personnel options issued in 2006/2007 (80,000) and 2007/2008 (100 000).
2) Dilution based on the convertible debenture loan 2005/2008 (165,200) and personnel options 2005/2008 (40,000) in the company's opinion is expected to be zero, since the conversion price is SEK 71.10. It is expected that the convertible loan will be redeemed on June 15, 2008.
3) Average number of shares has been adjusted for implemented share splits and share issues.
The bars show quarterly net sales and the line 12-months net sales.
The bars show quarterly earnings and the line 12-month earnings after financial items.
Condensed consolidated balance sheet
| SEK thousands | Apr 30, | Apr 30, |
|---|---|---|
| 2008 | 2007 | |
| Assets | ||
| Intangible assets | 217 638 | 159 343 |
| Tangible assets | 24 059 | 22 352 |
| Financial assets | 48 208 | 45 962 |
| Total fixed assets | 289 905 | 227 657 |
| Other current assets | 407 677 | 241 655 |
| Cash and bank balances | 288 358 | 385 150 |
| Total current assets | 696 035 | 626 805 |
| Total assets | 985 940 | 854 462 |
| Equity and liabilities | ||
| Equity (including profit for the period) | 560 670 | 519 407 |
| Provisions | 17 718 | 11 135 |
| Deferred tax liabilities | 28 659 | 25 906 |
| Long-term liabilities | 40 113 | 36 438 |
| Current liabilities | 338 780 | 261 576 |
| Total equity and liabilities | 985 940 | 854 462 |
Change in equity
| Full-year | Full-year | |
|---|---|---|
| SEK thousands | May–Apr | May–Apr |
| 2007/2008 | 2006/2007 | |
| Equity at start of period | 519 406 | 486 495 |
| New issue/conversion | 4 197 | 1 723 |
| Dividend paid | -18 421 | -18 373 |
| Shareholdings reclassified to subsidiaries | - | 667 |
| Change in translation difference | 1 370 | -634 |
| Share-based payments | 3 655 | 2 314 |
| Net earnings for the period | 50 463 | 47 214 |
| Equity at end of period | 560 670 | 519 406 |
Condensed consolidated cash-flow statement
| Full-year | Full-year | |
|---|---|---|
| SEK thousands | May–Apr | May–Apr |
| 2007/2008 | 2006/2007 | |
| Cash flow from operations before changes in working capital | 84 704 | 82 666 |
| Cash flow from operations after changes in working capital | 8 677 | 71 546 |
| Investing activities | -82 152 | -50 995 |
| Financing activities | -30 054 | -46 478 |
| Change in cash and bank balances | -103 529 | -25 927 |
| Cash and bank balances, opening balance | 385 150 | 414 297 |
| Exchange-rate difference in liquid assets | 6 737 | -3 220 |
| Cash and cash equivalents, closing balance | 288 358 | 385 150 |
Key figures
| Full year | Full year | |
|---|---|---|
| Apr 30, | Apr 30, | |
| 2008 | 2007 | |
| Order bookings, SEK M | 1,016.6 | 684.7 |
| Equity/assets ratio, % | 56.9 | 60.8 |
| Liquidity, multiple | 2.2 | 2.5 |
| Profit margin % | 10.7 | 10.4 |
| Return on shareholders' equity % | 9.3 | 9.4 |
| Return on capital employed % | 13.8 | 13.0 |
| Value added, SEK M | 8.9 | 8.6 |
| Average number of employees | 429.6 | 361.5 |
| Equity per share, SEK | 477 | 411 |
| Equity per share after dilution, SEK | 15.22 | 14.12 |
| Cash flow per share, SEK | 14.93 | 13.84 |
| Cash flow per share after dilution, SEK | 2.31 | 2.25 |
| P/E ratio, multiple | 2.26 | 2.20 |
| Share price at end of period, SEK | 42.7 | 59.2 |
| Order bookings, SEK M | 58.5 | 76.0 |
Consolidated income statement, quarterly
| 2007/2008 | 2006/2007 | 2005/2006 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SEK M | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
| Net sales | 224.5 | 189.3 | 179.2 | 149.9 | 204.7 | 169.4 | 163.5 | 134.9 | 172.8 | 146.1 | 144.7 | 100.8 |
| Capitalized work for own use | 30.1 | 10.8 | 10.1 | 6.8 | 10.6 | 12.3 | 11.6 | 8.1 | 6.8 | 8.3 | 6.7 | 3.7 |
| Operating expenses | -202.3 | -184.4 | -162.8 | -150.2 | -186.4 | -154.1 | -158.4 | -132.7 | -140.1 | -125.7 | -131.9 | -96.4 |
| Depreciation | -5.5 | -5.3 | -5.3 | -5.2 | -6.6 | -5.2 | -5.2 | -5.3 | -5.4 | -5.0 | -5.3 | -4.4 |
| Operating profit | 46.8 | 10.4 | 21.2 | 1.3 | 22.3 | 22.4 | 11.5 | 5.0 | 34.1 | 23.7 | 14.2 | 3.7 |
| Net financial items | -4.5 | 4.0 | -1.6 | 2.2 | 1.1 | 3.8 | 4.1 | 0.0 | 1.1 | 3.5 | -0.8 | 1.2 |
| Profit after financial items |
42.3 | 14.4 | 19.6 | 3.5 | 23.4 | 26.2 | 15.6 | 5.0 | 35.2 | 27.2 | 13.4 | 4.9 |
| Tax on earnings for the period Minority interest |
-19.1 - |
-3.3 - |
-6.1 - |
-0.8 - |
-9.4 - |
-7.7 - |
-4.7 - |
-1.1 - |
-8.1 - |
-7.0 - |
-3.9 - |
-1.5 - |
| Net profit for the period | 23.2 | 11.1 | 13.5 | 2.7 | 14.0 | 18.5 | 10.9 | 3.9 | 27.1 | 20.2 | 9.5 | 3.4 |
Five-year summary
| 2007/2008 | 2006/2007 | 2005/2006 | 2004/2005 | 2003/2004 | |
|---|---|---|---|---|---|
| Net sales, SEK M | 742.9 | 672.5 | 564.4 | 455.9 | 495.3 |
| Earnings before tax 1), SEK M | 79.8 | 70.2 | 80.7 | 80.4 | 27.6 |
| Earnings after tax, SEK M | 50.5 | 47.2 | 60.4 | 52.8 | 21.0 |
| Profit margin, % | 10.7 | 10.4 | 14.3 | 17.6 | 5.6 |
| Return on equity, % | 9.3 | 9.4 | 13.2 | 12.8 | 5.8 |
| ROCE, % | 13.8 | 13.0 | 16.0 | 17.1 | 8.8 |
| Return on total capital, % | 8.9 | 8.6 | 10.9 | 12.6 | 6.1 |
| Earnings per share before dilution, SEK | 1.37 | 1.28 | 1.64 | 1.45 | 0.63 |
| Earnings per share after dilution, SEK | 1.34 | 1.26 | 1.61 | 1.42 | 0.61 |
| Equity per share before dilution, SEK | 15.22 | 14.12 | 13.24 | 11.79 | 10.96 |
| Equity per share after dilution, SEK | 14.93 | 13.84 | 12.97 | 11.54 | 10.52 |
| Equity/assets ratio, % | 56.9 | 60.8 | 58.9 | 61.5 | 61.7 |
| Dividend per share, SEK | 0.50 | 0.50 | 0.50 | 0.50 | 0.50 |
| Stock market price at year end, SEK | 58.5 | 76.0 | 58.8 | 74.0 | 58.5 |
| P/E ratio | 42.7 | 59.2 | 35.7 | 49.7 | 92.9 |
1) A non-recurring write-down of capitalized development costs within Sectra Mamea AB had a negative effect of SEK 70.9 million on operating profit for full-year 2003/2004.
Parent Company condensed income statement
| 3 months | 3 months | Full-year | Full-year | |
|---|---|---|---|---|
| SEK thousands | Feb 2008 | Feb 2007 | May–Apr | May–Apr |
| – Apr 2008 | – Apr 2007 | 2007/2008 | 2006/2007 | |
| Net sales | 6 974 | 5 142 | 24 175 | 20 924 |
| Capitalized work for own use | - | - | - | - |
| Operating expenses | -3 209 | -7 036 | -20 733 | -25 630 |
| Depreciation | -113 | -164 | -517 | -718 |
| Operating profit after depreciation | 3 652 | -2 058 | 2 925 | -5 424 |
| Net financial items | 168 804 | 150 077 | 186 201 | 162 235 |
| Profit after financial items | 172 456 | 148 019 | 189 126 | 156 811 |
| Untaxed reserves | -10 221 | - 9 802 | -10 221 | -9 802 |
| Profit before tax | 162 235 | 138 217 | 178 905 | 147 009 |
| Tax on earnings for the period | -45 326 | -41 547 | -49 986 | -41 707 |
| Net profit for the period | 116 909 | 96 670 | 128 919 | 105 302 |
Condensed Parent Company balance sheet
| SEK thousands | Apr 30, | Apr 30, |
|---|---|---|
| 2008 | 2007 | |
| Assets | ||
| Intangible fixed assets | - | - |
| Tangible fixed assets | 1 543 | 1 542 |
| Financial fixed assets | 140 566 | 57 317 |
| Total fixed assets | 142 109 | 58 859 |
| Other current assets | 662 881 | 526 675 |
| Cash and cash equivalents | 202 823 | 256 768 |
| Total current assets | 865 704 | 783 443 |
| Total assets | 1 007 813 | 842 302 |
| Equity and liabilities | ||
| Equity (including profit for the period) | 518 930 | 472 263 |
| Provisions | - | - |
| Deferred tax liabilities | 28 801 | 25 939 |
| Long-term liabilities | 44 854 | 34 550 |
| Current liabilities | 415 228 | 309 550 |
| Total equity and liabilities | 1 007 813 | 842 302 |
Definition of key figures
| Adjusted equity | Reported shareholders' equity increased by 72% of untaxed reserves. |
|---|---|
| Capital employed | Total assets reduced by non interest-bearing debts. |
| Cash flow per share | Cash flow divided by the number of shares at the end of the period. |
| Earnings per share | Profit/loss after tax divided by the average number of shares. |
| Equity/assets ratio | Equity as a percentage of total assets. |
| Equity per share | Equity divided by the number of shares at the end of the period. |
| Liquidity | Current assets divided by current liabilities. |
| P/E ratio | Share price at the end of the period in relation to the twelve-month period's earnings per share. |
| Profit margin | Profit before tax as a percentage of sales. |
| Return on equity | Profit after tax as a percentage of average adjusted equity. |
| Return on capital employed (ROCE) | Profit before tax plus financial expenses as a percentage of average capital employed. |
| Return on total capital | Profit after net financial items plus financial expenses as a percentage of average total assets. |
| Value added | Operating profit plus labor costs. |
Accounting principles
This interim report was prepared in accordance with IAS 34, Interim Financial Reporting, and RR31, Interim Reporting for Groups. The same accounting principles and calculation methods apply as in the most recent Annual Report. This means that the consolidated accounts were prepared in accordance with International Financial Reporting Standards (IFRS) and statement form International Financial Reporting Interpretations Committee (IFRIC) that were approved by the EU Commission for application within the EU. A description of the accounting principles is found in the Annual Report for the 2006/2007 fiscal year.
Financial calendar
Three-month interim report, May–June 2008: September 9, 2008 Six-month interim report, May–Oct. 2008: December 10, 2008 Nine-month interim report, May 2008–Jan. 2009 March 3, 2009 Year-end report, 2008/2009: May 26, 2009
For further information, contact:
Jan-Olof Brüer, CEO and President, Tel. +46 (0)13 23 52 09
This interim report has not been reviewed by the company's auditors. Linköping, May 20, 2008 Board of Directors
Sectra AB (publ)
The information in this report is such that Sectra AB (publ) is obligated to disclose in compliance with the Securities and Clearing Operations Act and/or the Financial Instruments Trading Act. This information was released to the media for public disclosure on May 20, at 9:00 am (CET).